Sunday, September 19, 2010

Greenspan's Ominous Shift

Greenspan's Ominous Shift
Michael Maloney's picture

Posted by
Michael Maloney

We have been alluding to former Federal Reserve Chairman Alan Greenspan’s coming full circle to once again embrace gold as the ultimate asset class. As Chair of the Fed, Greenspan manipulated the U.S. economy through his control of fiat currency. But after his retirement, he is once again embracing gold as money and as the best investment.

However, we have yet to hear the confirmation from the horse’s mouth—until now. In a meeting in front of the Council on Foreign Relations, Alan Greenspan warned central bankers that they should be paying attention to gold, saying:
“Fiat money has no place to go but gold. If all currencies are moving up or down together, the question is: relative to what? Gold is the canary in the coal mine. It signals problems with respect to currency markets. Central banks should pay attention to it.”

Those words should ring loud and clear: “Fiat money has not place to go but gold.” 2010 marks the first time in over 20 years that central banks will be net buyers of gold. The last time that central banks made the switch from net sellers to net buyers was in the late 1970’s, which marked the early days of the massive gold rush that culminated in 1980.

And when a former Fed Chairman is saying it, it means that the collective mindset will soon be turning.

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